Question

TRUE or FALSE?

1. When the consumer price index falls, the typical family has to spend fewer dollars to maintain the same standard of living.

2. Economists use the term inflation to describe a situation in which the economy's overall price level is rising.

3. When a new good is introduced, consumers have more variety from which to choose, and this, in turn, increases the cost of maintaining the same level of economic well-being.

4. The real interest rate is the interest rate corrected for inflation.

5. Like physical capital, human capital is a produced factor of production.